[Federal Register Volume 77, Number 215 (Tuesday, November 6, 2012)]
[Proposed Rules]
[Pages 66568-66574]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-26748]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 284

[Docket No. RM12-17-000]


Revisions to Procedural Regulations Governing Transportation by 
Intrastate Pipelines

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Energy Regulatory Commission is proposing to 
revise its regulations to provide optional notice procedures for 
processing rate filings by those natural gas pipelines that fall under 
the Commission's jurisdiction pursuant to the Natural Gas Policy Act of 
1978 or the Natural Gas Act. An intrastate pipeline may elect to use 
these procedures for approval of a filing pursuant to the Commission's 
regulations. Under these procedures, if there is no protest to the 
filing as determined under this proposal, the filing would be deemed 
approved without a Commission order. The proposed rule would result in 
regulatory certainty and a reduction of regulatory burdens.

DATES: Comments are due December 6, 2012.

ADDRESSES: Comments, identified by docket number, may be filed in the 
following ways:
     Electronic Filing through: http://www.ferc.gov. Documents 
created electronically using word processing software should be filed 
in native applications or print-to-PDF format and not in a scanned 
format.
     Mail/Hand Delivery: Those unable to file electronically 
may mail or hand-deliver comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE., 
Washington, DC 20426.

Instructions: For detailed instructions on submitting comments and 
additional information on the rulemaking process, see the Comment 
Procedures section of this document

FOR FURTHER INFORMATION CONTACT: 


[[Page 66569]]


David Tishman (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street NE., Washington, 
DC 20426, (202) 502-8515, [email protected].
James Sarikas (Technical Information), Office of Energy Market 
Regulation, Federal Energy Regulatory Commission, 888 First Street NE., 
Washington, DC 20426, (202) 502-6831, [email protected].

SUPPLEMENTARY INFORMATION:

Table of Contents

 
                                                              Paragraph
                                                                 Nos.
 
I. Background..............................................            2
II. Discussion.............................................            8
    A. Optional Notice Procedure...........................            8
    B. Periodic Rate Review of the Rates and Charges of               18
     Intrastate Pipelines..................................
    C. Withdrawal Procedures...............................           20
III. Information Collection Statement......................           21
IV. Environmental Analysis.................................           28
V. Regulatory Flexibility Act..............................           29
VI. Comment Procedures.....................................           30
VII. Document Availability.................................           34
 

141 FERC ] 61,037
    (October 18, 2012)

    1. The Commission proposes new optional notice procedures which 
intrastate pipelines may elect to use when filing proposed rates or 
operating conditions pursuant to Sec.  284.123 of the Commission's 
regulations.\1\ Section 284.123 applies to filings by: (1) Intrastate 
pipelines providing interstate services pursuant to section 311 of the 
Natural Gas Policy Act of 1978 (NGPA) \2\ and (2) Hinshaw\3\ pipelines 
providing interstate services subject to the Commission's Natural Gas 
Act (NGA) jurisdiction pursuant to blanket certificates issued under 
Sec.  284.224 of the Commission's regulations.\4\ If there is no 
protest to a filing made under these notice procedures, the filing 
would be deemed approved without a Commission order. The Commission 
finds that the new procedures will result in regulatory certainty and a 
reduction of regulatory burdens on intrastate pipelines.
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    \1\ 18 CFR 284.123.
    \2\ 15 U.S.C. 3372.
    \3\ Section 1(c) of the NGA exempts from the Commission's NGA 
jurisdiction pipelines which transport gas in interstate commerce if 
(1) they receive natural gas at or within the boundary of a state, 
(2) all the gas is consumed within that state, and (3) the pipeline 
is regulated by a state Commission. This exemption is referred to as 
the Hinshaw exemption after the Congressman who introduced the bill 
amending the NGA to include Sec.  1(c). See ANR Pipeline Co. v. 
Federal Energy Regulatory Comm'n, 71 F.3d 897, 898 (1995) (briefly 
summarizing the history of the Hinshaw exemption).
    \4\ 18 CFR 284.224.
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I. Background

    2. NGPA section 311 authorizes the Commission to allow intrastate 
pipelines to transport gas ``on behalf of'' interstate pipelines or 
local distribution companies served by interstate pipelines ``under 
such terms and conditions as the Commission may prescribe.'' \5\ NGPA 
section 601(a)(2) exempts transportation service authorized under NGPA 
section 311 from the Commission's NGA jurisdiction. Congress adopted 
these provisions to eliminate the regulatory barriers between the 
intrastate and interstate markets and to promote the entry of section 
311 pipelines into the interstate market. Shortly after the adoption of 
the NGPA, the Commission authorized Hinshaw pipelines to apply for NGA 
section 7 certificates authorizing them to transport gas in interstate 
commerce in the same manner as section 311 pipelines may do under NGPA 
section 311.\6\
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    \5\ 15 U.S.C. 3371(c).
    \6\ Certain Transportation, Sales and Assignments by Pipeline 
Companies not Subject to Commission Jurisdiction Under Section 1(c) 
of the Natural Gas Act, Order No. 63, FERC Stats. & Regs. ] 30,118, 
at 30,824-825 (1980).
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    3. Subpart C of the Commission's Part 284 open access regulations 
(18 CFR 284.121-126) implements the provisions of NGPA section 311 
concerning transportation by intrastate pipelines. NGPA section 311 
provides that the rates of intrastate pipelines performing 
transportation service under the NGPA shall be fair and equitable. 
Section 284.123 of the regulations provides procedures for section 311 
and Hinshaw pipelines to establish fair and equitable rates for 
interstate services.
    4. Section 284.123(b) allows intrastate pipelines an election of 
the methodology upon which to base their rates for interstate services. 
Section 284.123(b)(1) permits an intrastate pipeline to elect to base 
its rates on the methodology used by the appropriate state regulatory 
agency (A) to design rates to recover transportation or other relevant 
costs included in a then effective firm sales rate for city-gate 
service on file with the state agency; or (B) to determine the 
allowance permitted by the state agency to be included in a natural gas 
distributor's rates for city-gate natural gas service. Section 
284.123(b)(1) also permits an intrastate pipeline to use the rates 
contained in one of its then effective transportation rate schedules 
for intrastate service on file with the appropriate state regulatory 
agency which the intrastate pipeline determines covers service 
comparable to service under Subpart C of Part 284.
    5. If the intrastate pipeline does not make an election under 
paragraph (b)(1) of Sec.  284.123, Sec.  284.123(b)(2) requires that it 
``apply for Commission approval, by order, of the proposed rates and 
charges'' pursuant to the procedures in that paragraph. Section 
284.123(b)(2)(i) provides for the pipeline to file a petition for 
approval of the proposed rates and charges, as well as information 
showing the proposed rates and charges are fair and equitable. Upon 
filing the petition for approval, the intrastate pipeline is permitted 
to commence the transportation service and charge and collect the 
proposed rate, subject to refund. Section 284.123(b)(2)(ii) provides 
that the rate proposed in the application will be deemed to be fair and 
equitable and not in excess of an amount which interstate pipelines 
would be permitted to charge for providing similar transportation 
service, unless within the 150 day period after the date on which the 
Commission received a filed application, the Commission either extends 
the time for action, or institutes a proceeding in which all interested 
parties will be afforded an opportunity for written comments and for 
the oral presentation of views, data, and arguments. The Commission has 
extended this 150 day period when necessary, for example, to allow 
settlement in contested proceedings or institute proceedings in complex 
cases.
    6. Section 284.123(e) requires that, within thirty days of 
commencement of a new service, any intrastate pipeline that engages in 
transportation arrangements under Subpart C of Part 284 must file with 
the Commission a statement that includes the pipeline's interstate 
rates, the rate election made pursuant to Sec.  284.123(b) of that 
section, and a description of how the pipeline will engage in these 
transportation arrangements, including operating conditions, such as 
gas quality standards and financial viability of the shipper. This 
statement is generally referred to as the pipeline's ``Statement of 
Operating Conditions.'' Section 284.123(e) also requires that, if the 
pipeline changes its operations, rates, or rate election, it must amend 
the statement and file such amendments no later than thirty days after 
commencement of the change in operations or the change in rate 
election.
    7. As part of its overall, more light-handed regulation of section 
311 and

[[Page 66570]]

Hinshaw pipelines, the Commission has established a policy of requiring 
a periodic review of the rates of both types of pipelines. The 
Commission has held that, because these pipelines are not subject to 
the same reporting requirements or level of rate review as interstate 
pipelines, a periodic review of the rates of section 311 and Hinshaw 
pipelines is necessary to ensure that those rates remain fair and 
equitable. In Order No. 735, the Commission modified its previous 
triennial rate review policy in order to decrease the frequency of 
review from three to five years from the date the approved rates took 
effect.\7\ While the periodic rate review requirement is not part of 
the Commission's regulations, the Commission has consistently imposed 
that requirement in its orders approving each rate filing by an 
intrastate pipeline. The Commission imposes this rate requirement, both 
when the intrastate pipeline has chosen to elect a state-based rate 
pursuant to Sec.  284.123(b)(1) or has proposed a rate for a 
Commission-approved rate pursuant to Sec.  284.123(b)(2).\8\
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    \7\ Contract Reporting Requirements of Intrastate Natural Gas 
Companies, Order No. 735, 75 FR 29,404, (May 26, 2010) FERC Stats. & 
Regs. ] 31,310, at P 96 (2010), order on reh'g, Order No. 735-A, 75 
FR 80,685 (Dec. 23, 2010), FERC Stats. & Regs. ] 31,318, (2010).
    \8\ Order No. 735 FERC Stats. & Regs. ] 31,310 at P 92 and cases 
cited.
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II. Discussion

A. Optional Notice Procedure

    8. In an effort to reduce burdens on regulated entities, the 
Commission is proposing to add a new optional notice procedure under 
which section 311 and Hinshaw pipelines could seek approval of proposed 
rates or operating conditions without the need for a Commission order. 
Under this procedure, the intrastate pipeline's filing would be deemed 
approved without any order of the Commission, if the filing is not 
protested within a specified period after notice of the filing or if 
any protests are resolved during a reconciliation period. This optional 
procedure would be included in Sec.  284.123(g) of our regulations.
    9. The Commission is taking this action as part of its commitment 
to continually review its regulations and streamline or eliminate 
requirements that impose an unnecessary burden on regulated entities. 
The Commission believes that this notice procedure would provide an 
expedited and less burdensome method of processing filings by section 
311 and Hinshaw pipelines which present few, if any, contested issues. 
Many of the intrastate pipeline companies filing rates and/or 
statements of operating conditions pursuant to Sec.  284.123 are small 
and have few interstate shippers. Discount rate agreements are common, 
with the result that often the pipeline performs most of its interstate 
services at rates which are discounted substantially below its maximum 
rates for such services. Most pipeline filings under Sec.  284.123 are 
not protested by any shipper. If a rate filing is protested, the 
protests often raise issues which are relatively amenable to 
settlement. The proposed optional notice procedure would permit 
approval of uncontested filings without the need for any Commission 
order upon expiration of a 60-day notice period (or other period 
established by the Secretary of the Commission for a particular 
filing). If a protest were filed within the notice period, proposed 
Sec.  284.123(g) provides for an additional 30-day reconciliation 
period to resolve contested filings without the need for the parties to 
file a formal settlement offer pursuant to the Commission's settlement 
rules in Sec.  385.601, et seq.\9\ or a Commission order on the 
pipeline's proposal.
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    \9\ 18 CFR 385.601, et seq. (2012).
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    10. Currently our regulations permit similar prior notice blanket 
certificate procedures for interstate pipelines in Sec.  157.205. That 
program has been in place for over three decades and has significantly 
reduced regulatory burden and provides pipelines certainty with regard 
to the disposition of their applications.\10\ The Commission believes 
that proposed Sec.  284.123(g) would similarly lessen regulatory 
burdens, provide increased regulatory certainty, and create an improved 
framework in which to achieve settlement of contested cases.
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    \10\ Interstate Pipeline Certificates for Routine Transactions, 
Order No. 234, FERC Stats & Regs. ] 30,368 (1982).
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    11. The optional notice procedure in proposed Sec.  284.123(g) 
would operate as follows: Within ten days after a filing by an 
intrastate pipeline pursuant to the optional notice procedure, the 
Secretary of the Commission would issue a notice of the filing, which 
would be published in the Federal Register. That notice would provide a 
deadline for interventions and initial comments fourteen days after the 
date of the filing and for final comments and protests sixty days after 
the date of the filing or such other date established by the Secretary 
of the Commission. As proposed, any person or the Commission's staff is 
permitted to file a protest prior to the deadline. If no protest is 
filed within the time allowed, the filing would be deemed approved 
without a Commission order, upon expiration of the time for filing 
protests, unless the intrastate pipeline has withdrawn, amended, or 
modified its filing or the filing is rejected prior to that date.
    12. If a protest is filed, proposed Sec.  284.123(g)(5) allows a 
reconciliation period for negotiations in a structured process to 
promote settlement of contested cases. Specifically, this section would 
permit the intrastate pipeline, the person who filed the protest in 
accordance with proposed Sec.  284.123(g)(4), any intervenors, and 
staff thirty days from the deadline for protests to the pipeline's 
filing, to resolve the protest, and to convene informal settlement 
conferences to assist in resolving the protest. If all protests to the 
filing are withdrawn pursuant to proposed paragraph (g)(6) by the end 
of the reconciliation period, the filing would be deemed approved. 
Alter- natively, proposed paragraph (g)(7) permits the pipeline to 
amend or modify a tariff record in order to resolve concerns raised in 
a protest. Proposed paragraph (g)(7) provides that such a filing will 
toll the notice period established under paragraph (g)(3) of this 
section for the original filing, and the Secretary of the Commission 
will issue a notice establishing new deadlines for comments and 
protests for the entire filing pursuant to paragraph (g)(3). The 
intrastate pipeline may request a deadline for protests less than 60 
days after the date of the filing. If there are no protests to the 
amendment or modification and any protests to the entire filing which 
have been filed are withdrawn, the amended filing would be deemed 
approved as of the day after the new deadline for protests established 
by the Secretary.
    13. If a filing is still contested after the above procedures are 
completed, the filing would not be deemed approved and, within sixty 
days from the deadline for filing protests, the Commission would 
establish procedures to resolve the proceeding. The 150-day period in 
existing Sec.  284.123(b)(2)(ii) under which filings are deemed 
approved unless the Commission acts within that period does not apply 
to filings pursuant to the new notice procedures.
    14. While the proposed rules would establish a reconciliation 
period to promote settlement of protested filings, compliance with the 
Commission's rules regarding off-the-record communications in Sec.  
385.2201 would be required. Under the general rule set forth in Sec.  
385.2201(b), in any proceeding where an intervenor disputes any 
material issue resulting in a contested

[[Page 66571]]

proceeding, no person outside the Commission shall make or knowingly 
cause to be made to a decisional employee, and no decisional employee 
shall make or knowingly cause to be made to any person outside the 
Commission, any off-the-record conversation, except off-the-record 
communications exempted by Sec.  385.2201(e). Therefore, under the 
Commission's proposed revisions to Sec.  284.123, when an intervenor 
disputes any material issue in the filings by intrastate pipelines the 
rules governing off-the-record conversations in Sec.  385.2201 would be 
applicable.
    15. The Commission is also adding procedures to further streamline 
the processing of these filings. The Director of the Office of Energy 
Market Regulation or his designee is required pursuant to paragraph 
(g)(2) to reject within seven days of the date of the filing any filing 
which patently fails to comply with the provisions of Sec. Sec.  
284.123(e) or 284.123(f), without prejudice to the intrastate 
pipeline's refiling a complete application. If such filing was required 
by Sec.  284.123, it must be refiled within fourteen days of the date 
of the rejection.
    16. The protestor may withdraw a protest under proposed paragraph 
(g)(6) by submitting written notice of withdrawal to the Secretary of 
the Commission pursuant to Sec.  385.216 of the Commission's 
regulations and serving a copy on the intrastate pipeline, any 
intervenors, and any other person who has filed a motion to intervene 
in the proceeding. If any protest is filed within the time allowed for 
protests and is subsequently withdrawn under proposed paragraph (g)(6), 
the filing by the intrastate pipeline would be deemed approved 
effective upon the later of the day after the deadline for filing 
protests, if there are no other protests to the filing, or the day 
after the withdrawal of all protests unless the intrastate pipeline 
withdraws, amends, or modifies its filing or the filing is rejected in 
accordance with this paragraph prior to that date.
    17. Under proposed paragraphs (g)(10) and (h) an intrastate 
pipeline may file to withdraw its filing prior to Commission action. 
Because Sec.  284.123(b)(2)(i) permits an intrastate pipeline to 
commence collecting a proposed rate subject to refund upon making its 
filing, the pipeline must state in its withdrawal motion that any 
amounts collected subject to refund in excess of the rates authorized 
by the Commission will be refunded with interest, and that it will file 
a refund report. The refunds must be made within sixty days of the date 
the withdrawal motion becomes effective. A filing that is withdrawn 
will not fulfill the requirements under proposed paragraph (g)(8) for 
approval of a filing.

B. Periodic Rate Review of the Rates and Charges of Intrastate 
Pipelines

    18. The Commission has a policy of requiring a review of the rates 
of both section 311 and Hinshaw pipelines every five years. While the 
periodic rate review requirement is not part of the Commission's 
existing regulations, the Commission has consistently imposed that 
requirement in its orders approving each rate filing by an intrastate 
pipeline. The proposed optional notice procedures provide for approval 
of the filing without a Commission order. Therefore, the Commission 
proposes in Sec.  284.123(g)(9) to require that a NGPA section 311 
intrastate pipeline whose rates are deemed approved under the optional 
notice procedures file an application for rate approval under Sec.  
284.123 on or before the date five years following the date it filed 
the application for approval of the rates pursuant to Sec.  284.123(g). 
Similarly, a Hinshaw pipeline whose rates are deemed approved under 
Sec.  284.123(g) would be required to file either (1) cost and 
throughput data sufficient to allow the Commission to determine whether 
any change to the pipeline's rates should be ordered pursuant to 
section 5 of the Natural Gas Act or (2) a petition for rate approval 
pursuant to Sec.  284.123, on or before the date five years following 
the date it filed the application for approval of rates pursuant to 
Sec.  284.123(g).\11\
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    \11\ The courts have held that the Commission cannot require 
interstate pipelines subject to its NGA jurisdiction to make new 
rate filings under NGA section 4. Public Service Commission of New 
York v. FERC, 866 F.2d 487 (DC Cir. 1989). Consumers Energy Co. v. 
FERC, 226 F.3d 777 (6th Cir. 2000). Because the Commission regulates 
interstate services performed by Hinshaw pipelines under the NGA, 
the Commission gives them the option of filing a cost and revenue 
study every five years, instead of a new petition for rate approval. 
Consumers Energy Co., 94 FERC ] 61,287 (2001).
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    19. Under the Commission's proposal, the periodic rate review in 
our regulations would only be applicable when intrastate pipelines file 
under these proposed procedures in Sec.  284.123(g). Therefore, the 
overall regulatory burden for the proposed procedures is less than 
current procedures for rate approval.

C. Withdrawal Procedures

    20. The Commission proposes in Sec.  284.123(h) to codify the 
procedures for section 311 and Hinshaw pipelines to withdraw any filing 
under Sec.  284.123 in its entirety prior to its approval, including 
filings made under the existing procedures in Sec.  284.123. Currently, 
the practice would require a request to withdraw a filing to be filed 
under the Commission's general rules of practice and procedure. Because 
Sec.  284.123(b)(2)(i) permits an intrastate pipeline to commence 
collecting a proposed rate subject to refund upon making its filing, 
proposed Sec.  284.123(h)(1) would require the pipeline to acknowledge 
that any amounts collected subject to refund in excess of the rates 
authorized the Commission will be refunded with interest and a refund 
report will be filed. The refunds must be made within sixty days of the 
date the withdrawal motion becomes effective. A shipper will have 15 
days to respond to the pipeline's filing. Section 284.123(h)(2) would 
make the pipeline's withdrawal of its filing effective at the end of 15 
days from the date of filing the withdrawal motion, if no opposition to 
the motion is filed within that period and the Commission does not 
issue an order disallowing the motion. This proposal would add 
regulatory certainty as to the Commission's treatment of withdrawal 
filings, and ensure that the pipeline will know its obligations if it 
withdraws a filing.

III. Information Collection Statement

    21. The Paperwork Reduction Act (PRA) \12\ requires each federal 
agency to seek and obtain Office of Management and Budget (OMB) 
approval before undertaking a collection of information directed to ten 
or more persons or contained in a rule of general applicability.\13\ 
The OMB's regulations implementing the PRA require approval of certain 
information collection requirements imposed by agency rules.\14\ Upon 
approval of a collection(s) of information, OMB will assign an OMB 
control number and an expiration date. Respondents subject to the 
filing requirements of an agency rule will not be penalized for failing 
to respond to these collections of information unless the collections 
of information display a valid OMB control number.
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    \12\ 44 U.S.C. 3501-3520.
    \13\ OMB's regulations at 5 CFR 1320.3(c)(4)(i) require that 
``[a]ny recordkeeping, reporting, or disclosure requirement 
contained in a rule of general applicability is deemed to involve 
ten or more persons.''
    \14\ 5 CFR 1320.
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    22. The Commission is submitting these proposed reporting and 
recordkeeping requirements to OMB for its review and approval. The 
Commission solicits comments on the proposed modifications, the 
accuracy of burden estimates, ways to enhance the

[[Page 66572]]

quality, utility, and clarity of the information to be collected, and 
any suggested methods for minimizing respondents' burden.
    23. The Commission's estimates of the average annual public 
reporting burden imposed on the section 311 and Hinshaw intrastate 
pipelines of making filings for rate approval under Sec.  284.123 will 
not change, except for an estimated burden of only 12 hours per year 
for the new withdrawal filing requirements as a result of the proposed 
rule in Docket No. RM12-17-000. Following is a table showing the 
existing burden estimate, a relabeling to reflect the new filing 
option, and the additional withdrawal procedures specifically tailored 
for intrastate pipelines.

----------------------------------------------------------------------------------------------------------------
                                                                                   Burden hours
                                                                                        per
              FERC-549 (OMB Control No. 1902-0086)                   Number of    respondent per   Total annual
                                                                    respondents   year (1 filing/  burden hours
                                                                                       year)
                                                                             (a)             (b)         (a x b)
----------------------------------------------------------------------------------------------------------------
Existing Inventory:
    Rates and Charges for Intrastate Pipelines (18 CFR                        67              12             804
     284.123(b) and (e))........................................
Proposed in NOPR in RM12-17:
    Rates and Charges for Intrastate Pipelines (18 CFR                        67              12             804
     284.123(b), (e) and (g))...................................
    Withdrawal of Filing prior to Approval (18 CFR 284.123(h))..               1              12              12
                                                                 -----------------------------------------------
      FERC-549 Total (Proposed).................................              67              12             816
----------------------------------------------------------------------------------------------------------------

    Information Collection Costs: The Commission has reviewed the 
burdens imposed by this rulemaking. The Commission's review found that 
the proposed changes will not affect the burden on section 311 
intrastate and Hinshaw pipelines of making an initial filing seeking 
approval of proposed rates or operating conditions pursuant to Sec.  
284.123. The preparation effort or the substance of a filing made 
pursuant to Sec.  284.123(g) would be the same as for a filing made 
pursuant to existing Sec. Sec.  284.123(b) and/or 284.123(e).
    24. The Commission is also proposing a new withdrawal procedure for 
filings made prior to their approval to reflect the unique nature of 
the intrastate pipeline regulations that allow a pipeline to file for a 
rate change and begin charging the new rates prior to Commission 
approval. The proposed new Sec.  284.123(h) regulation will reflect the 
regulatory process that addresses that unique rate implementation 
issue. The Commission believes it would add certainty to any intrastate 
pipeline making a withdrawal filing.
    25. The proposed changes will primarily affect the post-filing 
process and cost. The changes will reduce overall cost and delay for 
stakeholders; however that post-filing burden is beyond the scope of 
requirements of the Paperwork Reduction Act. The new optional 
procedures will provide both intrastate pipelines and their shippers 
greater regulatory certainty and a simpler process without any change 
in the upfront burden of preparing and making a filing.
    Title: FERC-549, NGPA Title III Transactions and NGA Blanket 
Certificate Transactions (OMB Control No. 1902-0086).
    Action: Proposed revisions.
    Respondents: Section 311 Intrastate and Hinshaw Natural Gas 
Pipelines.
    Frequency of Responses: At least once every five years.
    Need for Information: The Commission proposes adding a new optional 
notice procedure in Sec.  284.123(g) which section 311 intrastate and 
Hinshaw pipelines could use when making a filing seeking approval of 
proposed rates or operating conditions pursuant to Sec.  284.123. As 
proposed, an intrastate pipeline may choose to file using the current 
procedures pursuant to Sec. Sec.  284.123(b) and 284.123(e), or may 
elect to file pursuant to the new procedure. Section 284.123(g) 
provides a shortened period for final approval of the proposed rates 
and operating conditions and authorization if no protest is filed 
within the time allowed and a reconciliation period of 30 days from the 
deadline for protests to resolve contested filings without the need for 
a Commission order on the pipeline's rate proposal.
    26. In 18 CFR 284.123(h), the Commission also proposes to implement 
new regulations with respect to withdrawal of a filing prior to 
approval. The regulations provide more details about the rights and 
obligations of the intrastate pipeline and its shippers. These 
procedures would lessen regulatory costs, provide increased regulatory 
certainty, and result in an improved framework in which to achieve 
settlement of contested cases.
    Internal Review: The Commission has reviewed the proposed changes 
and has determined that the changes are necessary. These requirements 
conform to the Commission's need for efficient information collection, 
communication, and management within the energy industry. The 
Commission has assured itself, by means of internal review, that there 
is specific, objective support for the burden estimates associated with 
the information collection requirements.
    27. Interested persons may obtain information on the reporting 
requirements by contacting: Federal Energy Regulatory Commission, 888 
First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office 
of the Executive Director, email: [email protected], Phone: (202) 
502-8663, fax: (202) 273-0873]. Comments on the requirements of this 
rule may also be sent to the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Washington, DC 20503 
[Attention: Desk Officer for the Federal Energy Regulatory Commission]. 
For security reasons, comments should be sent by email to OMB at [email protected]. Please reference OMB Control No. 1902-0086, 
FERC-549, and Docket No. RM12-17 in your submission.

IV. Environmental Analysis

    28. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\15\ The 
Commission has categorically excluded certain actions from these 
requirements as not having a significant effect on the human 
environment.\16\ The actions proposed to

[[Page 66573]]

be taken here fall within categorical exclusions in the Commission's 
regulations for rules that are corrective, clarifying or procedural, 
for information gathering, analysis, and dissemination, and for sales, 
exchange, and transportation of natural gas that requires no 
construction of facilities.\17\ Therefore an environmental review is 
unnecessary and has not been prepared in this rulemaking.
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    \15\ Regulations Implementing National Environmental Policy Act, 
Order No. 486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs., 
Regulations Preambles 1986-1990 ] 30,783 (1987).
    \16\ 18 CFR 380.4.
    \17\ See 18 CFR 380.4(a)(2)(ii), 380.4(a)(5) and 380.4(a)(27).
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V. Regulatory Flexibility Act

    29. The Regulatory Flexibility Act of 1980 (RFA) \18\ generally 
requires a description and analysis of proposed rules that will have 
significant economic impact on a substantial number of small entities. 
The Commission identified two small entities as respondents to the 
requirements in the proposed rule.\19\ As explained above, the 
Commission estimates that the proposed Sec.  284.123(g) regulations 
will serve as a substitute for filings currently done pursuant to 
Sec. Sec.  284.123(b) and (e), and Sec.  284.123(h) provides regulatory 
certainty if a pipeline decides to withdraw its filing. The Commission 
estimates that intrastate pipelines will experience little if any 
change in regulatory burden associated with making their filings, and 
pipelines will be able to avoid certain costs and delays post-filing 
due to the new streamlined process. Accordingly, the Commission 
certifies that this rule will not have a significant impact on a 
substantial number of small entities and no regulatory flexibility 
analysis is required.
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    \18\ 5 U.S.C. 601-612.
    \19\ The U.S. Small Business Administration's (SBA) Table of 
Small Business Size Standards is found in 13 CFR 121.201. SBA's 
updated version of the size standards (effective March 26, 2012, and 
available at http://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf) defines a natural gas pipeline (contained in 
Subsector 486, Pipeline Transportation) as ``small'' when it has 
average annual receipts of $25,500,000 or less.
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VI. Comment Procedures

    30. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. Comments are due December 6, 2012. Comments must refer to 
Docket No. RM12-17-000, and must include the commenter's name, the 
organization they represent, if applicable, and their address in their 
comments.
    31. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's Web site at http://www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software should be filed in native applications or print-to-PDF format 
and not in a scanned format. Commenters filing electronically do not 
need to make a paper filing.
    32. Commenters that are not able to file comments electronically 
must send an original of their comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street NE., 
Washington, DC 20426.
    33. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

VII. Document Availability

    34. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through the Commission's Home Page (http://www.ferc.gov) and 
in the Commission's Public Reference Room during normal business hours 
(8:30 a.m. to 5:00 p.m. Eastern time) at 888 First Street NE., Room 2A, 
Washington DC 20426.
    35. From the Commission's Home Page on the Internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary in PDF and Microsoft Word format for viewing, 
printing, and/or downloading. To access this document in eLibrary, type 
the docket number excluding the last three digits of this document in 
the docket number field.
    36. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours from the Commission's Online 
Support at 202-502-6652 (toll free at 1-866-208-3676) or email at 
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at 
[email protected].

List of Subjects in 18 CFR Part 284

    Continental shelf, Natural gas, Reporting and recordkeeping 
requirement.

    By direction of the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.

    In consideration of the foregoing, the Commission proposes to amend 
Part 284, Chapter I, Title 18, Code of Federal Regulations, as follows.

PART 284--CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE 
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES

    1. The authority citation for Part 284 continues to read as 
follows:

    Authority: 15 U.S.C. 717-717z, 3301-3432; 42 U.S.C. 7101-7352; 
43 U.S.C. 1331-1356.

    2. Section 284.123 is amended by adding paragraphs (g) and (h) to 
read as follows:


Sec.  284.123  Rates and charges.

* * * * *
    (g) Election of Notice Procedures. (1) Applicability. An intrastate 
pipeline filing for approval of rates, a statement of operating 
conditions, and any amendments or modifications thereto pursuant to 
this section may use the notice procedures in this paragraph. Any 
intrastate pipeline electing to use these notice procedures for a 
filing must clearly state its election to use these procedures on the 
first page of its filing. Such filing is approved and the rates deemed 
fair and equitable and not in excess of the amount that an interstate 
pipeline would be permitted to charge for similar transportation 
service if the requirements paragraph (g)(8) of this section have been 
fulfilled.
    (2) Rejection of filing. The Director of the Office of Energy 
Market Regulation or his designee shall reject within 7 days of the 
date of filing a request which patently fails to comply with the 
provisions of paragraphs (e) or (f) of this section, without prejudice 
to the intrastate pipeline's refiling a complete application. If such 
filing was required by this section, that filing must be refiled within 
14 days of the date of the rejection.
    (3) Publication of notice of filing. The Secretary of the 
Commission shall issue a notice of the filing within 10 days of the 
date of the filing, which will then be published in the Federal 
Register. The notice shall designate a deadline for filing 
interventions, initial comments, final comments, and protests to the 
filing. The deadline for interventions and initial comments shall be 14 
days after the date of the filing. The deadline for final comments and 
protests shall be 60 days after the date of the filing or such other 
date established by the Secretary of the Commission.
    (4) Protests. (i) Any person or the Commission's staff may file a 
protest prior to the deadline for protests. Copies of the protest must 
be served on the

[[Page 66574]]

Secretary of the Commission and the intrastate pipeline.
    (ii) Protests shall be filed with the Commission in the form 
required by Part 385 of this Chapter including a detailed statement of 
the protestor's interest in the filing and the specific reasons and 
rationale for the objection and whether the protestor seeks to be an 
intervenor.
    (5) Effect of protest. If a protest is filed in accordance with 
paragraph (g)(4) of this section, then the intrastate pipeline, the 
person who filed the protest, any intervenors, and staff shall have 30 
days from the deadline for filing protests established by the Secretary 
of the Commission in accordance with paragraph (g)(3) of this section, 
to resolve the protest, and to file a withdrawal of the protest 
pursuant to paragraph (g)(6) of this section. Informal settlement 
conferences may be convened by the Director of the Office of Energy 
Market Regulation or his designee during this 30 day period. If a 
protest is not withdrawn or dismissed by end of that 30 day period, the 
filing shall not be deemed approved pursuant to this paragraph. Within 
60 days from the deadline for filing protests established by the 
Secretary of the Commission in accordance with paragraph (g)(3) of this 
section the Commission will establish procedures to resolve the 
proceeding.
    (6) Withdrawal of protests. The protestor may withdraw a protest by 
submitting written notice of withdrawal to the Secretary of the 
Commission pursuant to Sec.  385.216 and serving a copy on the 
intrastate pipeline, any intervenors, and any person who has filed a 
motion to intervene in the proceeding.
    (7) Amendments or modifications to tariff record prior to approval. 
An intrastate pipeline may file to amend or modify a tariff record 
contained in the initial filing pursuant to the procedures under this 
paragraph (g) which has not yet been approved pursuant to paragraph 
(g)(8) of this section. Such filing will toll the notice period 
established in paragraph (g)(3) of this section and the Secretary of 
the Commission will issue a notice establishing new deadlines for 
comments and protests for the entire filing pursuant to paragraph 
(g)(3).
    (8) Final approval. (i) If no protest is filed within the time 
allowed by the Secretary of the Commission under paragraph (g)(3) of 
this section, the filing by the intrastate pipeline is approved, 
effective on the day after time expires for filing protests unless, 
during that time, the intrastate pipeline withdraws, amends, or 
modifies its filing or the filing is rejected pursuant to this 
paragraph.
    (ii) If any protest is filed within the time allowed by the 
Secretary of the Commission under paragraph (g)(3) of this section and 
is subsequently withdrawn before the end of the 30-day reconciliation 
period provided by paragraph (g)(5) of this section, the filing by the 
intrastate pipeline is approved effective upon the later of the day 
after the deadline for filing protests, if there are no other protests 
to the filing, or the day after the withdrawal of all protests unless 
the intrastate pipeline withdraws, amends, or modifies its filing or 
the filing is rejected, prior to that date.
    (9) Periodic rate review. Rates of pipelines approved by the 
Commission pursuant to this paragraph are required to be periodically 
reviewed. Any intrastate pipeline with rates so approved must file an 
application for rate approval under this section on or before the date 
five years following the date it filed the application for 
authorization of rates pursuant to this paragraph. Any Hinshaw pipeline 
that has been a granted a blanket certificate under Sec.  284.224 of 
this chapter and with rates approved pursuant to this paragraph must on 
or before the date five years following the date it filed the 
application for authorization of the rates pursuant to this paragraph 
either file cost, throughput, revenue and other data, in the form 
specified in Sec.  154.313 of this chapter to allow the Commission to 
determine whether any change in rates is required pursuant to 5 of the 
Natural Gas Act or an application for rate authorization pursuant to 
this section.
    (10) Withdrawal of filing prior to approval. A pipeline may, 
pursuant to paragraph (h) of this section, withdraw in its entirety a 
filing made pursuant to this paragraph (g) that has not been approved 
by filing a withdrawal motion with the Commission. A filing that is 
withdrawn will not fulfill the requirements under paragraph (g)(8) of 
this section.
    (h) Withdrawal of filing. A pipeline may withdraw in its entirety a 
filing pursuant to this section that has not been approved by filing a 
withdrawal motion with the Commission.
    (1) The withdrawal motion must state that any amounts collected 
subject to refund in excess of the rates authorized the Commission will 
be refunded with interest calculated and a refund report filed with the 
Commission in accordance with Sec.  154.501 of this chapter. The 
refunds must be made within 60 days of the date the withdrawal motion 
becomes effective.
    (2) The withdrawal motion will become effective, and the filing 
will be deemed withdrawn at the end of 15 days from the date of filing 
of the withdrawal motion, if no order disallowing the motion is issued 
within that period. If an answer in opposition is filed within the 15 
day period, the withdrawal is not effective until an order accepting 
the withdrawal is issued.

[FR Doc. 2012-26748 Filed 11-5-12; 8:45 am]
BILLING CODE 6717-01-P